By most accounts, filling the Watermark building in downtown Green Bay would not be hard to do, but the project is languishing because the developer doesn't have the cash to complete build-outs, and the financing is complex and difficult to recapitalize.

Watermark, on the east bank of the Fox River at the western end of Pine Street, is a 70,000-square-foot building, part of the former Younkers department store. It has a single tenant, C.H. Robinson, a logistics transportation company that occupied one floor in 2103.

Financing includes multiple entities, including the city of Green Bay. The city loaned the project $3.5 million at 5.5 percent interest for seven years. Calumet County Bank and its partners loaned $4.5 million. The Wisconsin Housing and Economic Development Authority provided about $2.1 million using New Market Tax Credits, which were purchased by U.S. Bank, and Vetter Denk Architects, the developer, has about $1.7 million in equity, but no cash to put into it.

An analysis by one investor concluded $4.7 million would be needed to recapitalize the project and the city would have to forgive its debt. City Attorney Tony Wachowicz said $4.7 million is the upper end of the amount that might be needed.

"The city just doesn't want to outright forgive the whole loan," he said. "We've made it clear that's something we are not interested in."

Other options, such as deferred payments, could be more acceptable.

Wachowicz is leaving soon to work for Prevea Health, but the city selected a law firm experienced in real estate and finance to work on the Watermark, Larsen Green and the KI Convention Center/Clarion Hotel projects, Mayor Jim Schmitt said Friday.

"That is a project that needs continued attention from all entities," he said. "I'm OK with this. We have a plan in place."

With new interior construction, location adjacent to CityDeck and the Fox River Trail, and views of the river, the building is attracting attention, said Jeff Mirkes, executive director of Downtown Green Bay Inc. He sometimes shows the building to interested parties.

"I have noticed a growing interest in the Watermark," he said. "The city and my office have been taking more calls over the past few weeks about that space."

The developer is behind on payments and doesn't have the money to complete interior construction for a new tenant, Wachowicz said.

C.H. Robinson paid for its own build-out in return for lease concessions.

"You can't have the whole building doing that because you are not generating income for the developer," Wachowicz said.

C.H. Robinson has a five-year lease. The city guaranteed three years beyond the lease. Should C.H. Robinson move out during those three extra years, the city will find a new tenant or be responsible for up to $450,000 in payments total.

The Watermark project included The Children's Museum of Green Bay and Hagemeister Park restaurant, which both opened in 2013. Wachowicz said those projects, as well as the Riverfront Lofts condominiums, all developed by Vetter Denk, were vital to the success of downtown redevelopment.

Developer John Vetter could not be reached for comment.

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The Fox River side of the Watermark building on North Washington Street in downtown Green Bay.(Photo: Richard Ryman/Press-Gazette Media)

"I would say that, at the end of the day, he wants to get out and move this project forward," Wachowicz said.

One complication to adding new investors is the New Market Tax Credits element. A federal program, it has all the legal encumbrances you would expect.

"That structure is complicated and restrictive, to some extent," Wachowicz said. "And changing it is expensive from a legal and banking perspective."

Mirkes said a number of restaurants showed interest in the ground floor, which has access to both Pine Street and CityDeck.

"Getting that activated intensifies and strengthens interest in the rest of the building," which is better suited to office use, Mirkes said.

He said C.H. Robinson is a good example of what can be done in the building.

Condominiums on the upper floors also have been considered.

Talks among investors have been ongoing for months, though not much has happened recently.

"It is really becoming incumbent upon the decision makers, the owners group, the financial backers, to come up with a well thought-out development strategy," Mirkes said.

— rryman@greenbaypress gazette.com and follow him on Twitter @RichRymanPG or on Facebook at Richard Ryman-Press-Gazette